A little over a decade ago, Vineet Nayar CEO of HCLT, developed the model “Employee First Customers Second” or EFCS, for his firm and in so doing built a highly successful business around that paradigm and scored major accolades for re-inventing the 21st Century Business Management Model leading to a book of the same name.
https://hbr.org/2010/07/put-your-employees-first.html
https://www.forbes.com/sites/karlmoore/2012/05/14/employees-first-customers-second-why-it-really-works-in-the-market/#2020afd912c4
How is the model in practice one decade later ?
putting the customers first is very important. I think everything should be customer focused. The one number you need to grow is applicable in much more better way.
https://hbr.org/2003/12/the-one-number-you-need-to-grow
If origin of everything is customer, employees KPIs are also linked with customer satisfaction, then company perform better.
Article Customer-based brand equity and firms' performance in the te...
Moreover, you can listen the thought of Amazon current CEO, Apple late CEO steve job , as per them customer preferences/happiness obsession is the key thing in their success.
Theoretically employee first and customer second looks good for employees. In action customer first works better.
HI,
I think in this case, the CEO wanted his team to functional first. Once they are comfortable working for the company, then they would be able to serve the customers better. A non-satisfied employee would never be able to serve the customer well. But once they are satisfied with their work and reward from the company, then they would serve the customers as wanted by the company.
Would you all agree with me?
Wan Zaidi
Employees should be given priority as they are the internal customers of the organization, and the organization is to be represented to the external customers by the internal customers.
Wealth maximization first. It could be social wealth, technological wealth, or financial wealth whatever is the mission of the business.
I learned an important lesson from the marketing manager of a credit union, a person who did not even have a high school degree. She developed a program based on the premise that both members (customers) and employees were equally important assets. While a credit union may be thought of as a non-profit they competed with profit firms. In the market they competed with they were able to reach a very high market share in a variety of areas including loans because of this proposition. The same analysis of treating each as as asset, doing the numbers, was used. Focusing on one over the over is shortsighted, no pun intended, since both are critical.
I appreciate the fads of going back and forth between customers and employees makes for new streams of research. What I recommend is for research go beyond the traditional model. There are firms that practiced what I argue for here. Southwest Airlines, for example, was an example of the equal asset approach. There are probably others.
That model is much older than a decade. "Employees first" was and still is a slogan of "Wegmans" - a food retail chain in North-West of the USA for at least 20 years and it’ put Wegmans in Fortune’s “100 Best Companies to Work For” list every year since it started in 1998.
Treating Human Resources as the most important asset of the organization coincides with Endomarketing. A company has 3 purposes to fulfill: to make a profit (remunerate the shareholders); offer goods and services to consumers that meet their real needs; and provide conditions for personal and professional growth to their talents.
"Employees First Customers Second": Absolutely, right. Once employees' self-esteem is improved, they become to voluntary make an effort to produce better services to the customers.
Dear Silburn,
Great question!
1) Customers
2) Employees
3) Managers
4) Senior Managers / Executives
5) Board Members
Customers are prior to all human capitals in business, including employees, managers and executives. Employees are prior to managers, senior executives and other members of the same company. Board is prior to executives.
That being said, it does not mean specific customer can demand "too differently" from the firm. Customers in general are best to be treated "somewhat" similarly.
Best regards,
J.
The core issue is that if customers are defined as being more important than employees it becomes difficult to get employees to serve customers. The simple question is: who serves customers? Why would you want a firm not to see them at the same level since like the age old musical lyrics "love and marriage you can't have one without the other." Of course, these can be divided as recent behaviors suggest. Why should an employee work toward serving customers, increasing customer loyalty if they are not viewed at the same level?
I really find the division moot and argue that researchers need to go out into the world and study firms more closely. Ivory tower theorizing of which I have done and regretted is not a substitute for empirical work.
Ronald Savitt
Dear Ronald,
Simple! Because employees get paid and customers are the ultimate key to that payment. I do not discuss about customer loyalty or satisfaction, or if customers want a specific feature in a product, or demand desired services, or any combination thereof.
Yet, customers are simply prior to employees, in my opinion.
Best regards,
J.
To quote CK Prahlad from his foreword to the book (Employees First Customers Second), this book is a narrative of organizational transformation and a practical guide for managers who wish to achieve similar results, as well as a story of the personal transformation of a CEO.
What struck me as significant about the book were the following aspects:
It is about the journey of an organization very Indian in its origins and culture
and about the experiences of an Indian CEO in bringing about change within
this psyche – this means it is a journey we can all relate very well to and draw
a lot of practical lessons from.
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